BP will pay $4.5 billion in Deepwater Horizon oil spill settlement

Today BP Plc announced that it will pay $4.5 billion and plead guilty to 14 criminal charges related to the epic environmental disaster that occurred more than two years ago in the Gulf of Mexico.

The settlement with the Department of Justice and Securities and Exchange Commission resolves criminal claims related to the Deepwater Horizon oil spill, which was the worst offshore spill in the country’s history. BP owned a well connected to the Deepwater Horizon drilling rig, which exploded in April 2010 and resulted in the death of 11 workers and 4.9 million barrels of oil spilling into the Gulf for 87 days.

BP’s settlement outweighs the current record criminal penalty in U.S. history. Pfizer Inc. paid the highest fine in 2009 when it shelled out $1.3 billion to the government for marketing fraud. BP will pay $4 billion to the government and various environmental agencies over five years. A law enforcement official also told the New York Times that two BP employees will be charged with manslaughter in the case. U.S. Attorney General Eric Holder is expected to disclose more details at a press conference later today.

“Today’s agreement is consistent with BP’s position in the ongoing civil litigation that this was an accident resulting from multiple causes, involving multiple parties, as found by other official investigations,” BP said in a statement.

The settlement, however, doesn’t include federal civil claims and claims for damages to natural resources. The company could face massive Clean Water Act fines, which could add up to $21 billion.

BP also is working to resolve private civil claims. In March, the company agreed to settle a class action suit in which more than 100,000 plaintiffs are claiming the disaster caused them medical and economic damages. The $7.8 billion settlement is still pending approval.